اندازه گیری عملکرد مالی و غیرمالی : آنها چگونه بر رضایت شغلی تاثیر می گذارند؟

Recent interest on the use of nonfinancial measures (e.g. in the Balanced Scorecard) generally assumes that such measures are essential to overcome the inadequacies of financial measures. However, it remains unclear (1) if the behavioural effects of these nonfinancial measures are different from those of financial measures; and (2) whether these effects are influenced by the relative importance of nonfinancial measures vis-à-vis financial measures. This study hypothesises that the use of performance measures for performance evaluation will significantly affect managers' job satisfaction. However, these effects are indirect through the managers' perceptions of the fairness of these measures and the interpersonal trust these measures promote. Based on a sample of 70 managers, these expectations are supported by the results. More importantly, the results also suggest that (1) the process by which nonfinancial measures affect employee job satisfaction is not different from that of financial measures, and (2) the relative importance of nonfinancial measures vis-à-vis financial measures has no significant effect on employee job satisfaction. These results may have important theoretical and practical implications.

Since performance evaluation usually affects employee compensation and rewards (Kaplan and Atkinson, 1998 and Horngren et al., 2002), employees are likely to be concerned with the performance evaluation process including the types of measures used to evaluate their performance. This study investigates the behavioural consequences of the use of financial measures and nonfinancial measures for performance evaluation. Performance measures are studied here because of the increased attention to the possible behavioural consequences of the different types of measures used in contemporary organizational settings. The current widespread adoption of nonfinancial measures is generally based on the notion that traditional financial measures may be too late, too aggregated and too one dimensional to be useful because they are narrow in focus, historical in nature and incomplete (Kaplan, 1984, Lynch and Cross, 1991, Ittner and Larcker, 1998 and Hoque et al., 2001). In contrast, nonfinancial measures such as those relating to the customer, internal business process, and learning and growth perspectives are generally broader with greater emphasis on future and long-term objectives. Kaplan (1983, p. 686) suggests that ‘a particular challenge is to de-emphasize the current focus of senior managers on simple, aggregate, short-term financial measures and to develop indicators that are more consistent with long-term competitiveness and profitability.’ Kaplan and Atkinson (1998, p. 379) similarly note that ‘as organizations invest in acquiring…new capabilities, their success (or failure) cannot be motivated …in the short run solely by the traditional financial accounting model… the Balanced Scorecard introduces the drivers of future financial measures.’ This suggests that the use of long-term nonfinancial measures is likely to somehow generate more positive employee behaviours than those generated by the use of short-term financial measures. However, to date, there is little systematic empirical evidence to indicate if and how managers would react to the use of nonfinancial measures. It is also unclear if such reactions are similar to or different from those generated by the use of the more traditional financial measures. Moreover, since organizations, which adopt nonfinancial measures for performance evaluation, are required to ascertain the relative importance or weights to be assigned to nonfinancial measures vis-à-vis financial measures, it is also imperative that they understand if and how different combinations of nonfinancial and financial measures affect employee behaviours. These issues are important to facilitate the selection of the best mix of measures for performance evaluation. Indeed, there had been considerable management accounting research on the behavioural consequences of performance evaluation methods and procedures. However, these studies have generally focused on accounting (financial) performance measures (RAPM or budget emphasis) (e.g. Hopwood, 1972, Otley, 1978, Ross, 1994 and Otley and Pollanen, 2000). In contrast, little research has been undertaken with respect to the use of nonfinancial performance measures (Ittner and Larcker, 1998) or on the behavioural consequences of the relative importance of the two categories of measures, financial and nonfinancial. Our study, therefore, attempts to address these gaps in the literature. In studying the relationships between performance measures and managerial behaviours, our study will also investigate the intervening effects of two variables identified in earlier studies by Hopwood, 1972 and Otley, 1978, but have since been given little research attention. These are (1) the subordinates' perceptions of the fairness of performance evaluation procedures (procedural fairness/justice) and (2) the levels of the subordinates' trust in their supervisors. The study of procedural fairness is important because of its likely effects on the organizational members' attitudes (Hopwood, 1972 and Lind and Tyler, 1988). There is now a growing interest among management accounting researchers in this area (e.g. Libby, 1999, Lau and Lim, 2002 and Wentzel, 2002). Our study contributes to this important area by studying procedural fairness in the context of nonfinancial measures vis-à-vis financial measures. Interpersonal trust is also investigated in our study because successful performance evaluation is likely to occur only in an environment where trust among organizational members can develop. Trust is an important feature of the performance evaluation process because increased interpersonal trust between the subordinates and their superiors is likely to lead to improved communication and openness among organization members (Read, 1962). In the management accounting context, several studies (e.g. Hopwood, 1972, Otley, 1978, Ross, 1994 and Lau and Buckland, 2001) have found a significant relationship between performance evaluation and trust in supervisor. Hence, our study hypothesises that trust in supervisor, along with fairness in performance evaluation procedures, may be the important intervening variables which mediate the relationships between the types of performance measures used and employee work-related attitudes. Specifically, it investigates how the use of nonfinancial measures and financial measures can (1) enhance the subordinates' perceptions of the fairness of the evaluation process, and (2) promote the subordinates' trust in their superiors, and (3) ultimately, the subordinates' job satisfaction. Fig. 1 reflects these relationships and presents the model used in this study.The next section discusses the theory development and hypothesis formulation. This is followed by the method, results, discussion, conclusions and limitations of the study.

This study has three major objectives. First, it investigates if the adoption of nonfinancial measures for managerial performance evaluation is associated with job satisfaction, and if so, whether this relationship is indirect. Specifically, it hypothesises that the use of nonfinancial measures in managerial performance evaluation is positively associated with job satisfaction. It also hypothesises that this relationship is indirect and mediated by (1) fairness in performance evaluation procedures and (2) trust in supervisor. The second objective of this study is to ascertain if the process by which the adoption of nonfinancial measures for managerial performance evaluation is similar or different from that arising from the adoption of the more traditional financial measures. Third, it ascertains if the relative weight assigned to nonfinancial measures vis-à-vis financial measures is related to job satisfaction. In order to test these hypotheses, it employed a path analytical model to analyse the data. With respect to the nonfinancial measures model, the results indicate that the relationship between nonfinancial measures-based performance evaluation and job satisfaction was indirect and mediated by fairness in performance evaluation procedures and trust in supervisor. These results suggest that the adoption of multiple nonfinancial measures to evaluate subordinates' performance can affect their satisfaction level. However, these effects were due mainly to the favourable perceptions engendered by such measures. Specifically, subordinates perceived the use of nonfinancial measures for performance evaluation as fair. They also perceived those who adopted such performance measures as trustworthy. Hence, there was increased trust toward those superiors who adopted such measures. These favourable perceptions, in turn, were associated with higher job satisfaction. With respect to the financial measures model, results similar to those of the nonfinancial measures model were found. These results indicate that the relationship between financial measures-based performance evaluation and job satisfaction was also indirect and mediated by fairness in performance evaluation procedures and trust in supervisor. These results are surprising since the characteristics of financial measures and nonfinancial measures are different. For instance, financial measures are often regarded as narrow in scope and with a short-term outlook whereas nonfinancial measures are broader with a longer-term outlook. Kaplan and Atkinson (1998, p. 443) noted that ‘interest in nonfinancial measures of performance reflected an understanding that financial measures of performance are, by their nature, short-run measures of results, neither familiar nor intuitive ways for people to manage operations. Nonfinancial measures, such as quality, not only provide an explanation of current sales levels, but also are potentially a predictor of future sales levels.’ Our results indicate that such differences may not affect the employees' perceptions of fairness and trust in these two categories of measures. It, therefore, seems that the behavioural consequences of both types of measure are the same, despite many claims to the contrary in the normative and practitioner literature. Finally, there have been suggestions that the relative weight assigned to nonfinancial measure vis-à-vis financial measures may have a significant effect on employee behaviours. Our results indicate no such significant effects. Overall, our results are consistent with the previous findings of procedural fairness studies in the legal, political and organizational contexts (e.g. Alexander and Ruderman, 1987 and McFarlin and Sweeney, 1992) and also in the management accounting context (e.g. Lindquist, 1995, Magner et al., 1995, Libby, 1999, Lau and Lim, 2002 and Wentzel, 2002). These prior studies found that procedural fairness affected behaviour. With regard to the role of trust in performance evaluation, our results are also consistent with those found by prior studies (e.g. Hopwood, 1972, Otley, 1978 and Ross, 1994). More importantly, our study has extended the results of prior studies by developing the models and providing the empirical evidence to demonstrate how these two important mediating variables, namely, procedural fairness and trust, can be used to explain why the use of specific performance measures, regardless of whether they are financial or nonfinancial, can lead to favourable employee behaviours. This is elaborated below. The similarities in the results of the nonfinancial measures model and the financial measures model suggest that the differences in the two categories of measures may not have as large an impact on the subordinates' behaviours as previously assumed. This conclusion is reinforced by our finding that the weights assigned to the two categories of measures were not related to job satisfaction. These findings support the proposition that organizations which have well defined and well specified measures for performance, regardless of whether they are financial measures or nonfinancial measures, engender higher levels of procedural fairness and trust in supervisors, and consequently, higher levels of employee job satisfaction than those organizations with less well defined and less well specified performance measures. From a theoretical perspective, these conclusions are consistent with goal setting theory. This theory suggests that the specificity of goals is likely to lead to favourable employee behaviours. Locke and Latham (1991, p. 108) argued that the presence of specific goals, especially challenging ones, ‘are associated with higher self-efficacy…entails less ambiguity about what constitutes high or good performance, are typically more instrumental in bringing about valued outcomes…direct attention and action better…motivate individuals to search for suitable task strategies, to plan….’ Our findings are consistent with this theory. They support the proposition that it was the presence or absence of specific performance measures, rather than whether the measures were nonfinancial or financial, which had an impact on employee job satisfaction. These findings and conclusions are important as they assist to explain how the specificity of performance measures, the employees' perceptions of the fairness of their organizations' performance evaluation procedures, their levels of trust toward their superiors, and their levels of job satisfaction, are intricately linked. From a practical perspective, the findings may be helpful to organizations. The choice between financial measures and nonfinancial measures may be less important than previously thought. Nor should organizations be overly concerned with the relative importance of the two categories of measures. Instead, organizations should ensure that the performance measures they use to evaluate their employee performance are clearly identified, are well specified, and communicated clearly to their employees. A number of avenues exist for future research. For instance, goal theory suggests that apart from the specificity of goals, employee behaviours are also affected by other characteristics of goals such as the level of goal difficulty. Future research could explore how the level of goal difficulty affects the relationships between nonfinancial measures based performance evaluation and employee behaviours. Moreover, as our study has included only two intervening variables, namely, procedural fairness and trust, opportunities exist for future research to investigate the intervening effects of other variables, which may also be related to the use of multiple performance measures. These may include distributive fairness (equity), the extent of employee involvement in the development of performance measures as well as role ambiguity and role conflict. As with other empirical studies, there are limitations associated with this study. First, there are the limitations associated with the survey questionnaire method. Second, although the sample of this study was drawn from managers who were each the head of a functional area (e.g. manufacturing managers, marketing managers, human resources managers or administration managers), the number of responses from each subgroup of managers was small. For instance, the total number of respondents who identified themselves clearly as manufacturing managers was too small for meaningful statistical analysis to be undertaken for this subgroup of managers. Hence, the analyses were undertaken for all the 70 managers instead of for each subgroup (e.g. manufacturing managers only or marketing managers only). Additionally, since our sample was selected from larger-sized organizations with more than 100 employees each, it is unclear if our results are generalisable to smaller-sized organizations with less than 100 employees each. Finally, as our sample was selected only from the manufacturing sector, generalizing our results to non-manufacturing sector should be made with caution.